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US blacklists dozens of Chinese firms including SMIC, DJI

WASHINGTON: The United States added dozens of Chinese companies, including the country’s top chipmaker SMIC and Chinese drone manufacturer SZ DJI Technology to a trade blacklist.

The move is seen as the latest in Trump’s President Donald Trump’s administration efforts to increase up tensions with China in his final weeks in office. The US Commerce Department said the action against SMIC stems from Beijing’s efforts to harness civilian technologies for military purposes and evidence of activities between SMIC and Chinese military industrial companies of concern.

The Commerce Department will “not allow advanced U.S. technology to help build the military of an increasingly belligerent adversary,” Secretary Wilbur Ross said in a statement.

The department also said it was adding the world’s biggest drone company DJI to the list along with AGCU Scientech, China National Scientific Instruments and Materials, and Kuang-Chi Group for allegedly enabling “wide-scale human rights abuses.”

“The United States will use all countermeasures available, including actions to prevent (Chinese) companies and institutions from exploiting U.S. goods and technologies for malign purposes,” Secretary of State Mike Pompeo added in a separate release.

SMIC will only face a tough review standard when it seeks licenses for highly advanced US chipmaking equipment at 10 nanometers or below. Licenses for all other items shipped to the company will be reviewed on a case-by-case basis, the Commerce Department said.

Chinese authorities did not mince words about Washington’s latest gambit. In an address to the Asia Society on Friday, China’s foreign minister Wang Yi noted the expanding list of US sanctions and called on Washington to stop its “arbitrary suppression” of Chinese companies.

China’s foreign ministry said that if true, the blacklisting would be evidence of U.S. oppression of Chinese companies and that Beijing would continue to take “necessary measures” to protect their rights. “We urge the U.S. to cease its mistaken behavior of unwarranted oppression of foreign companies,” ministry spokesman Wang Wenbin told a regular news conference in Beijing on Friday.

The Commerce Department released a list of 77 companies and affiliates to the so-called entity list, including 60 Chinese companies. The designations by the Commerce Department include some entities in China that allegedly enable human rights abuses and some helping it construct and militarise artificial islands in the South China Sea. It also cited entities that acquired US-origin items to support the Chinese military and those engaged in the theft of US trade secrets.

Companies previously added to the list include telecoms equipment giants Huawei Technologies Co and 150 affiliates, and ZTE Corp over sanction violations, as well as surveillance camera maker Hikvision over suppression of China’s Uighur minority.